Amazon will be forced to face the music in an antitrust suit brought by resurrected e-commerce competitor Zulily.
A Washington judge refuted Amazon’s plea to dismiss a case brought by the online retailer—which shuttered in December 2023 and relaunched in September 2024 following an acquisition by Beyond, Inc.—alleging that the company has created an illegal monopoly and used its dominance to snuff out competition.
According to Zulily (which, like Amazon, sells a products from a variety of categories, from apparel and footwear to books, electronics and home goods), the e-tail behemoth has developed a monopoly over the industry through price-fixing agreements with third-party vendors and wholesalers.
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Amazon requires sellers on its site to set their off-Amazon prices equal to or higher than Amazon prices, ensuring that the marketplace will have a competitive advantage over competitors. Amazon’s current “Fair Pricing Policy” indicates that the company routinely monitors and compares the prices of items sold on its platform with sellers’ off-Amazon e-commerce operations and their sales on other marketplaces.
Such practices, along with others designed to hem in wholesalers, discourage brands and other third-party sellers from working with other platforms, Zulily argued. The company alleged that Amazon’s illegal conduct “bars entry and forecloses competition, making it very difficult for would-be competitors to enter and/or expand in the Online Superstore Market.”
Judge John Chun of the U.S. District Court for the Western District of Washington on Dec. 31, 2024 ruled that the antitrust case against the company may proceed, confirming that Zulily’s claims that the company’s “anti-discounting” practices qualify as anticompetitive under federal antitrust laws. He did grant the e-commerce titan’s motion to dismiss several elements of the case, including a claim that Amazon is spearheading a conspiracy with retailers and wholesalers, as well as a deceptive practices claim under Washington state law.
Chun is also overseeing the Federal Trade Commission’s (FTC) antitrust case against Amazon, and in October denied much of the company’s motion to dismiss the government complaint.
Slated to go to trial next year, the case alleges that Amazon regularly engages in anticompetitive behavior both on its marketplace and through its service offerings to third-party sellers, like logistics, fulfillment and advertising. Key to the complaint, first brought in September 2023, is the allegation that Amazon degrades product selection and search quality for shoppers.
The Washington judge did dismiss parts of the complaint, including several allegations filed by individual states regarding breaches of state laws.
Amazon and Zulily did not immediately respond to requests for comments.
